Publication detail

Business angels and early stage decision making criteria: empirical evidence from an emerging market

SKALICKÁ, M. ZINECKER, M. BALCERZAK, A. PIETRZAK, M.

Original Title

Business angels and early stage decision making criteria: empirical evidence from an emerging market

Type

journal article in Web of Science

Language

English

Original Abstract

How do business angels assess a prospective entrepreneurial firm when they make an investment decision? This article examines a central question that informal venture capitalists have been struggling with for decades: What early stage decision making criteria do investors define and apply to reduce the volume of potential deals to a more manageable size? Based on semi-structured interviews with business angels in an emerging market, we show that investors are focused on the industry structure and product features, on the other side, our results also suggest a very strong support for the personality of the entrepreneur and management team. More specifically, entrepreneur trustworthiness is an essential element affecting an investor’s decision to close a deal. Business angels set requirements in terms of the entrepreneur’s equity stake in the start-up and monitoring tools to prevent the failure of investee firms. Our findings suggest that if there are warning signs that the project is in an existential crisis, most of the investors will reject their participation. We believe that our empirical results support both researchers and practitioners to establish a better understanding between the well-developed financial theories and the underresearched informal venture capital market in a Central and Eastern European country.

Keywords

Business angels; decision making; early stage; screening criteria; rejection criteria; survey; policy implications; emerging market

Authors

SKALICKÁ, M.; ZINECKER, M.; BALCERZAK, A.; PIETRZAK, M.

Released

26. 5. 2022

Publisher

Taylor & Francis

Location

Pula

ISBN

1331-677X

Periodical

EKON ISTRAZ

Year of study

2022

Number

APR

State

Republic of Croatia

Pages from

1

Pages to

26

Pages count

26

URL

https://www.tandfonline.com/doi/full/10.1080/1331677X.2022.2063920

BibTex

@article{BUT178832,
  author="Martina {Skalická} and Marek {Zinecker} and Adam Przemyslaw {Balcerzak} and Michał Bernard {Pietrzak}",
  title="Business angels and early stage decision making criteria: empirical evidence from an emerging market",
  journal="EKON ISTRAZ",
  year="2022",
  volume="2022",
  number="APR",
  pages="1--26",
  doi="10.1080/1331677X.2022.2063920",
  issn="1331-677X",
  url="https://www.tandfonline.com/doi/full/10.1080/1331677X.2022.2063920"
}